‘In the assumed absence of transport costs and trade restrictions, perfect commodity arbitrage insures that each good is uniformly priced (in common currency units) throughout the world – the “law of one price” prevails’. In reality the law of one price is flagrantly and systematically violated by empirical data.
(Extract from: Isard, P., (1977 ), How Far Can we Push the “Law of One Price”?, American
Economic Review, 67 (5), 942-948).
Discuss and critically evaluate this statement with reference to the theory and empirical evidence relating to the law of one price (LoP) and the theory of purchasing power parity (PPP).

Please use headings to help structure the essay
Double spacing Font size 12
use more scientific/ academic journals rather than internet sites. something around 18-20 academic journals required

do not use/reference investopedia and wikipedia.
do not talk about covered and uncovered parity and fisher effect.
talk about LoP and PPP but you dont have to devote equal space to LoP and PPP. The LoP is more of a starting point, and you should spend more time on PPP.

9 Pages